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MMFLA UPDATE: LARA Re: Existing Facilties and Licensing Fees


Guest Josh_Colton
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Guest Josh_Colton

 

Some clarity provided on fee structure for the licensing process, but nothing finite as they have only provided a range of potential fees. 

 

September 12, 2017 - At a meeting of the Medical Marihuana Licensing Board later today, the Department of Licensing and Regulatory Affairs (LARA) will inform the board members regarding several oversight issues and the implementation of the regulatory framework for the new Medical Marihuana Facility Licensing Act (MMFLA). LARA, in consultation with the board, has sole authority to promulgate rules and emergency rules as necessary to implement, administer, and enforce the MMFLA.

LARA will notify the board of its intent to submit emergency rules necessary for the initial implementation of the MMFLA. The emergency rules – expected to be submitted in November – will further establish regulatory policies, including the application and licensing process and the fee structure. LARA is currently working with the board to develop permanent rules.

Existing Facilities

LARA consulted with the Michigan Attorney General’s office regarding facilities and dispensaries currently in operation and determined that any regulatory action will require an administrative rule. The department’s intent for the emergency rules is to consider any operation of a facility – that would otherwise need to be licensed under the MMFLA – as a potential impediment to licensure if continued after December 15, 2017. LARA will begin accepting license applications for all facilities on that date. This applies to all facilities defined under MMFLA. This approach will allow existing operations to wind down while also giving adequate time for patients to establish connections to caregivers to help ensure continuity of access.

Fee Structure

MMFLA requires LARA, in consultation with the board, to set the application fee and the annual regulatory assessment for each license. LARA will notify the board of its intent to submit emergency rules related to the following fee structure:

  1. The Application Fee is non-refundable and offsets the cost for LARA, the Michigan State Police (MSP), and/or contract costs for investigative services in order to conduct the background investigation of those applying for licenses. The nonrefundable application fee – which must be submitted with the application – will likely be in the $4,000 to $8,000 range, depending on the number of applications received.
  2. The annual Regulatory Assessment offsets operational costs and other statutory mandates including LARA’s costs to implement the act. It also offsets the cost of medical-marihuana-related services provided to LARA by the Michigan Attorney General’s office, MSP, and the Dept. of Treasury. By statute, the assessment must also provide $500,000 annually to LARA for licensing substance abuse disorder programs in addition to five percent of other state departments’ costs to the Michigan Department of Health and Human Services for substance abuse-related expenses.

LARA is currently determining the annual regulatory assessment for fiscal year 2018 for each of the five license categories authorized by MMFLA. Grower A licenses are capped, by statute, at $10,000. Grower B-C, Processor, Transporter, and Provisioning Center licenses will be dependent on the number of total licenses subject to assessment and could be as low as $10,000 or as high as $57,000. The regulatory assessment does not apply to safety compliance facilities.

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